Фискальная политика в условиях угрозы двойного кризиса
When central bank abandons fixed exchange rate, it creates a threat of default, since government external debt increases. In this situation fiscal authorities make strategic decision whether to default and finance its government purchases only through tax revenues and seigniorage or to pay government debt. In order to explain government’s choice we build stylized model, where fiscal authorities compare social welfare from these strategies. The main difference of our model from the existing literature is that we consider government’s choice of optimal seigniorage. Seignioarage gives government an incentive to declare a default, since in case of default benevolent government can use seigniorage to finance government spending and increase utility of households. Analysis of the model shows, that even when foreign investors completely trust a government, at a certain level of total factor productivity and initial debt government can declare a default when central bank abandons fixed exchange rate. We show that incentives to default are higher in countries with low factor productivity and high level of initial debt. This result is illustrated by examples of currency crises in Mexico 1994-1995, Argentina 2001-2002 and Turkey 2000-2001.
A significant limitation of the model presented in the work is the modeling of the behavior of foreign investors who consider the probability of a government default equal to zero. Introducing endogenous expectations of foreign investors, which hold government bonds, can help to explain a twin crisis as a self-fulfilling prophecies crisis and explain factors, which influence choice of government in case of devaluation.
Before the financial crisis, fiscal policy often played a secondary role to monetary policy, with the manipulation of interest rates to hit inflation targets being the main instrument of macroeconomic management. However, after the financial crisis and the subsequent euro crisis, fiscal policy has been brought back to the fore. In the past, the limited understanding of the effects of fiscal policy, neglect of monetary-fiscal interactions, faulty institutional set ups or ignorance of market expectations often led to bad policies. This book, written by a team of leading economists, seeks to address the current oversight of fiscal policy and to upgrade our understanding and conduct of fiscal policy, presenting a well-balanced diagnosis and offering several important lessons for future fiscal analysis and policymaking. It is an essential read for academics and graduate students focused on the current debate over fiscal policy, as well as policy-makers working on day-to-day policy issues.
We present an integrated framework for the study of the inter- national nancial economy with trade, at money, monetary and s- cal policy, endogenous default and regulation. Money is introduced via a cash-in-advance requirement and real trade is endogenous. The standard international nance pricing results obtain. Market incom- pleteness and positive default in equilibrium allow for the study of the transmission of default through the international nancial markets and imply a positive role for policy. Finally, we present an example where, due to the trade-o? between the non-pecuniary cost of default and the resulting allocation, a Pareto improvement occurs following an increase in interest rates.
This article presents a comparative analysis of the credit behavior of borrowers in banking retail sector, depending on areas they work. Industries were identified in which the most and the least creditworthy borrowers work. We analyzed the impact of the crisis on the credit behavior of borrowers working in different industries. We revealed that the economic shock had a significant impact on the creditworthiness of employees of financial institutions and construction industry. But it was found that there was the most rapid restoration in these areas in the post-crisis period.
The paper examines the structure, governance, and balance sheets of state-controlled banks in Russia, which accounted for over 55 percent of the total assets in the country's banking system in early 2012. The author offers a credible estimate of the size of the country's state banking sector by including banks that are indirectly owned by public organizations. Contrary to some predictions based on the theoretical literature on economic transition, he explains the relatively high profitability and efficiency of Russian state-controlled banks by pointing to their competitive position in such functions as acquisition and disposal of assets on behalf of the government. Also suggested in the paper is a different way of looking at market concentration in Russia (by consolidating the market shares of core state-controlled banks), which produces a picture of a more concentrated market than officially reported. Lastly, one of the author's interesting conclusions is that China provides a better benchmark than the formerly centrally planned economies of Central and Eastern Europe by which to assess the viability of state ownership of banks in Russia and to evaluate the country's banking sector.
The paper examines the principles for the supervision of financial conglomerates proposed by BCBS in the consultative document published in December 2011. Moreover, the article proposes a number of suggestions worked out by the authors within the HSE research team.